Asset Structure

The Swiss National Bank’s assets essentially consist of foreign currency, gold and financial assets in Swiss francs (securities and claims from repo transactions). They fulfil important monetary policy functions. Their composition is determined mainly by the established monetary order and the requirements of monetary policy. Part of the assets, including claims from repo transactions, serve immediate monetary policy purposes. The SNB uses repo transactions to supply commercial banks with liquidity in the form of base money by purchasing securities from them. By setting the terms for such transactions, the SNB is able to influence the level of interest rates in the money market. The National Bank holds currency reserves – in the form of foreign currency and gold – in order to have sufficient monetary policy leeway at all times. Currency reserves serve to prevent and overcome potential crises.

Asset classes

 

The Swiss National Bank’s assets essentially consist of foreign currency, gold and financial assets in Swiss francs (securities and claims from repo transactions). They fulfil important monetary policy functions. Their composition is determined mainly by the established monetary order and the requirements of monetary policy. Part of the assets, including claims from repo transactions, serve immediate monetary policy purposes. The SNB uses repo transactions to supply commercial banks with liquidity in the form of base money by purchasing securities from them. By setting the terms for such transactions, the SNB is able to influence the level of interest rates in the money market. The National Bank holds currency reserves – in the form of foreign currency and gold – in order to have sufficient monetary policy leeway at all times. Currency reserves serve to prevent and overcome potential crises.

 

Breakdown of Swiss National Bank assets

[NP][/NP]

Investments

 

Most of the investments are fixed-income assets. They comprise claims from repo transactions, Swiss franc securities, claims from gold lending transactions and most of the foreign exchange reserves. The remaining foreign exchange reserves consist of equities. The bond portfolios in local and non-local currencies consist of government and quasi-government bonds as well as bonds issued by international organisations, local authorities, financial institutions and other companies. In the case of foreign exchange reserves, secured and unsecured money market investments are, to a limited extent, also made at banks. Exchange rate and interest rate risks are managed by means of derivative instruments, such as interest rate swaps, interest rate futures, forward foreign exchange transactions and foreign exchange options. In addition, futures on equity indices are also used to manage the equity investments. 

 

. "Swiss National Bank." . . Swiss National Bank. 1.31.08 <http://www.snb.ch/en>.